Insights

It may not be the sexiest part of being a homeowner, but having the correct home insurance in place, will ensure you save yourself a lot of grief and dollars in the long term. Here’s what’s good to know, to protect one of your biggest assets.

 

 

Home insurance (also known as building insurance) covers the cost of repairing or rebuilding your home, as well as damage from unforeseen events out of your control, such as natural disasters, storms, floods and bushfires.

 

It’s common for home owners to combine their home insurance policy with contents insurance - this is referred to as 'Home and Contents’ insurance.

 

 

Doing your research and comparing products from the different insurance providers is the best place to start. 

 

You want to make sure you choose a policy that suits your individual needs and level of risk. 

 

Ensure you . . . 

 

1. Take the time to calculate the amount of home insurance you need thoroughly, so you don’t run the risk of being underinsured.

 

2. Read the policy disclosure statement (PDS) before choosing your policy, as terms and conditions can vary between policy types and insurers.

 

3. Check for any cooling-off provisions in your policy, so you’re aware how long you have to change your mind if your certificate of insurance, doesn’t meet your expectations.

 

 

As well as the traditional home and contents insurance, there are also a growing list of other types of home insurance available for home owners. 

 

Below we’ve highlighted the standard types of damage cover included in most policies. However, please note that these can sometimes be optional, so always check your PDS to ensure you’re adequately covered.

 

 

Fire damage insurance covers the costs to repair or replace your home and your belongings, in the event of fire. It can also include additional costs such as temporary accommodation, whilst your home under maintenance.

 

In the potential event of a fire, experts recommend that you correctly estimate the full replacement value of your property. This includes, taking an inventory of all belongings, as well as include additional expense, such as site clean-up costs.

 

Also note that insurers state that for a fire to have occurred, there needs to be a flame present. Most insurers will not cover other heat-related problems like scorching or melting.

 

 

Whilst most Australian homes are located in areas that have little, or no flood risk, approximately 80% of flood-related losses come from areas with past flood history.

 

If you live in a suburb that has suffered from floods in the past, you need to ensure you are covered. 

 

Also, if you own a home in a flood-prone area, you will typically pay a higher premium than homeowners outside of your area.

 

If your home is at risk of flood damage, always review the terms and conditions of your insurance policy, outlined in your Policy Disclosure Statement (PDS).

 

 

Today, we rely heavily on using electrical appliances around the home to live comfortably. However; when these machines fail, it can disrupt our standard of living significantly. 

 

Motor burnout insurance applies to certain appliances that are burnout by an electric current or power surge. Typical cover includes appliances such as fridges, dishwashers, pool pumps and so on – but this may vary between insurers.

 

Always speak to your insurer and check your PDS to confirm what appliances are included or if any extra costs apply.

 

 

November and March is our “storm season” in Australia. However unexpected heavy rain and winds can hit anytime of the year, resulting in serious damage to property.

 

Whilst, storm damage cover is usually included in most home and contents policies, you will find the definitions vary between insurers. So as a rule of thumb, always make sure your home insurance policy covers you for hail damage and heavy rain and winds, especially if you live in a low-lying area. 

 

Lastly, you should also make sure your policy not only adequately covers the cost of repairs, but also the replacement of valuables and temporary accommodation if required. 

 

 

No matter how well you take care of your home, there is always the chance of an accident. 

 

What if the kids knock over the television when playing? Or what if a dinner guest spills red wine all over your carpet?  Or, what if when you’re in a rush to get to work, you leave your phone or tablet behind on the train!?

 

Accidents do happen. 

 

That’s why insurers offer accidental damage or loss cover as an optional extra on top of your standard home and contents policy.

 

Accident cover offers much-needed protection (at an extra premium), in the event of unforeseen events that damage your home or contents.

 

Whilst accidental damage is generally defined the same across the industry, always check the PDS before deciding to add it to your cover. 

 

 

There is really no one-size-fits-all when it comes to home insurance. What you need will will depend on your own home, location and personal living situation. 

 

Remember, if your home is your castle, then it makes sense to protect it in any way possible.